itBit Bitcoin Market Report: May 2016

The price of bitcoin rose nearly 8% in April, reaching a yearly high of $468 on April 26 before retreating to close the month at $446. Bitcoin outperformed the S&P index in April, which was flat for the month. The rise in bitcoin price coincided with a spike in commodities prices, fueled by a weakened US Dollar. Gold was up nearly 6% on the month while silver jumped almost 18%.

2016 YTD Bitcoin Price Chart

BITCOIN Price Snapshot

Past Month

+7.6%

Year-To-Date

+4.1%

April was a relatively quiet month for bitcoin news with the exception of the code being released for Segregated Witness. This is important news from a bitcoin fundamentals standpoint as it can be viewed as a big step forward in settling the block size debate and eliminating the lingering uncertainty around bitcoin’s future.

Japanese Bitcoin Exchange bitFlyer raises $27 million in series C round

-0.4%

4/29

Blockchain data platform Tierion raises $1m USD

+1.3%

May Price Outlook

The bitcoin price has fallen back into the $450 range after hitting a 2016 high of $468 in April. Volatility has returned and volumes have remained relatively low, the latter being one of the key reasons we didn’t see follow-through on the price highs.

In the near-term, $437 is a big area of support on the downside, while $455 is a key resistance point. Longer-term support levels can be found at $432 and $419, respectively.

Key Macro Event to Watch in May

Segregated Witness

The key macro events to keep an eye on this month are specific to bitcoin rather than the broader traditional markets. With Segregated Witness code being released, will the bitcoin community finally get greater clarity on the implementation plan and roadmap? This is a central question that if answered appropriately could help alleviate much of the uncertainty that has surrounded bitcoin and positively impact price.

Crypto asset trading involves a high degree of risk. The crypto asset market is new and unproven and may
not grow. Currently, there is relatively small use of crypto assets in the retail and commercial
marketplace in comparison to relatively large use by speculators, thus contributing to
price volatility that could adversely affect an investment in crypto assets. In order to
participate in the trading of crypto assets, you should be capable of evaluating the
merits and risks of the investment and be able to bear the economic risk of
losing your entire investment. No material at this site should be considered
as an offer by itBit to sell or solicitation by itBit of any offer to buy bitcoin or other crypto assets.